Leading Insurance Broker Agrees to Pay $190 Million and Adopt Sweeping
Reforms

Attorney General Eliot
Spitzer and Acting New York State Insurance Superintendent Howard Mills, together with
Connecticut Attorney General Richard Blumenthal, Illinois Attorney General Lisa Madigan
and Illinois Acting Director of Insurance Deirdre Manna, today announced an agreement with the nation's second largest insurance
brokerage to resolve allegations of fraud and anti-competitive practices.

Under the agreement, the
Chicago-based Aon Corporation is providing $190 million over a 30- month period for
restitution to policyholders and is adopting a new business model designed to avoid
conflicts of interest. In addition, Aon's Chairman and CEO, Patrick G. Ryan, has issued a
public statement apologizing for Aon's improper conduct.

"The underlying
complaint in this case shows that improper conduct was pervasive at Aon," Attorney
General Spitzer said. "To its credit, however, the company has acknowledged the
problems, has agreed to compensate policyholders and has adopted reforms that will provide
greater accountability in the future."

Superintendent Mills said:
"Aon will under the terms of this settlement bring greater transparency to the
insurance marketplace by providing significant disclosure to clients and instituting
substantive corporate governance reforms. The big winners here are consumers who
understandably need assurances that they are receiving appropriate insurance products at
the best price."

Attorney General Blumenthal
said: "This hidden "pay to play' scheme severely hit both public and private
purses, including ordinary consumers, towns and cities, taxpayers and major educational
institutions. Aon demanded kickbacks from insurers in exchange for business, even as it
was paid by customers. The scheme inflated prices and stifled competition. Today's action
compels Aon to cease this illegal, unethical practice immediately and pay
restitution."

Attorney General Madigan
said: "Our investigation revealed that Aon Corporation accepted secret payments from
insurers for steering them business. Aon's acceptance of these secret payments was a
direct conflict of interest that harmed Aon's clients. Aon's acceptance of kickbacks was
not only unethical, but illegal. This settlement will guard against future conflicts of
interest and help to return integrity to this industry."

The civil complaint filed
today in State Supreme Court in Manhattan and the citation
issued by the New York Insurance Department allege that for years Aon received special
payments from insurance companies that were above and beyond normal sales commissions.
These payments -- known as "contingent commissions" -- were characterized as
compensation for "services to underwriters" but were, in fact, rewards for the
business that Aon steered and allocated to the insurance companies. Industry
representatives defend this long-standing practice as acceptable and even beneficial to
clients, but Spitzer's office and the Insurance Department have uncovered extensive
evidence showing that the practice distorts and corrupts the insurance marketplace and
cheats insurance customers.

In addition to promising to
send business to its insurance company partners in exchange for cash payments, Aon also
promised to place business with insurers in exchange for the insurers' agreement use Aon's
reinsurance brokerage services.

Spitzer's complaint against
the company cites internal communications in which top executives openly discussed these
efforts to maximize Aon's revenue and insurance companies' revenues * without regard to
Aon's clients' interests.

In addition, the complaint
cites the involvement of Mr. Ryan in efforts to increase placements with an insurance
company in exchange for that company's use of an Aon subsidiary (Aon Re) for reinsurance
brokering.

The complaint also alleges
that Michael O'Halleran, Ryan's second-in command, personally negotiated
"clawback" arrangements in which Aon Re would provide insurers with discounts or
rebates on its reinsurance commissions on the condition that Aon could recover or
"claw back" these discounts through retail placements made with the same
insurers.

Among the reforms adopted by
Aon is a new policy in which the company will accept one payment only for an insurance
contract at the time of placement, and that its payments will be fully disclosed to and
approved by Aon's customers.

The agreement with Aon was
modeled after an earlier agreement reached January 31 with the nation's largest insurance
broker, Marsh & McLennan Companies.

Spitzer's office and the New
York State Department of Insurance continue a broad investigation of the insurance
industry. To date, ten executives from four companies have pleaded guilty to criminal
charges stemming from the probe.